Okay. Welcome everyone to the 2025 J.P. Morgan Industrials Conference. My name is Steve Tusa. I cover the electrical equipment and multi-industry companies here. We're very happy to kick it off this morning with Honeywell, and the head of Aerospace, Jim Currier. You know, we're gonna do a few questions and then Q&A at the end. Don't be afraid to raise your hand. Jim, thanks for being with us today. No, appreciate it. Great opportunity. Aerospace probably, one of the less controversial end markets right now, although, you know, Delta didn't sound too great last night. Maybe you could just start, with, state of the union, what you're, what you're working on these days. Obviously, you guys have the, the, separation coming up. Right. More of kind of a fundamental state of the union, any kind of updates you wanted to give on the separation to start. Yeah, no, absolutely. I think from a Honeywell Aerospace perspective, a couple things I would say is the way we're positioned in the market today, I see a lot of tailwinds for us going forward. We have a very strong industrial installed base. We're coming off of and entering another period of rapid OEM production growth as well going forward. I love the positioning that we have in our defense and space business, products on certain platforms that are growing as well. That setup works out very well. I think, as you know as well, we closed out on two acquisitions last year, which set us up very nice with CAES and Civitanavi Systems and the growth area for us in the defense and space market. That's looking very well. Last year, for us, we had an absolute banner year in terms of lifetime wins of contracts that we secured well over $40 billion. Unprecedented for what we've seen before. It was almost like two and a half what we've ever seen in any prior year before that, largely driven by the technologies, the innovation that we're doing, and the investments that we're making across the portfolio. That setup has been very good for us. I would tell you from your comment about the separation aspect, I can't think of a better time to be very excited about the opportunities that this presents for Honeywell Aerospace in terms of our separation. Very strong management team across our organization. Everybody on my staff has, you know, anywhere from 15 to 30 years of experience specifically in Honeywell Aerospace. The ability to have very focused, capitalized investments that we wanna make going forward, our operating system, I feel, is one of the best in our industry in terms of efficiency and productivity across the board. The commitment that we've made as part of the separation announcement is that we will ensure that we're gonna have an investment-grade balance sheet going forward. That's sort of the macro view, I would say, for us as Honeywell Aerospace. If I break that down into a little bit more within the end market specifically, within Honeywell, what we've guided for 2025 is overall Honeywell Aerospace being in the mid-single digit to high single digit range going forward. What I would tell you, the commercial OE portions of our business, as I mentioned, air transport, BGA, particularly in the BGA segments, business aviation segments, where we have a lot of our avionics and engine content are all gonna be growing double digit. Aftermarket will be mid to high single digits in that realm, largely driven by commercial air transport. We're still seeing a lot of growth happening in flight hours in that realm. I would say that's gonna be more of the mid to high singles, business aviation aftermarket, somewhere in the low to maybe mid-single digit realm. You look at defense and space. We had an absolute banner year last year in our defense and space business in terms of growth. There was double-digit growth. This year, you know, the comps get a little bit tougher in regards to that. The backlog is very strong that we have. Our book-to-bill has been very strong in defense and space, and we're anticipating mid-singles in that, in that end market segment for us. How do supply constraints play into this or your output, if you will? Mm-hmm. I think for you guys, it's lingered a little bit longer, perhaps, than we would've expected. Where do you stand on unlocking some of that? Yeah. We've had 10 consecutive quarters of double-digit output from our factories, right? We're seeing the unlock that is happening across the board. What I will tell you in terms of, like, where we've lagged a little bit, I think an element that I would consider and remember is the fact that the diversification of our portfolio spans everything from the electronics portions of our business all the way through the mechanical portion. When I look at that, I will tell you that our electronics portion of our business has recovered quite nicely across the board. We're back close to being on purchase order for many of our customers. The mechanical side is still very fragmented. It's still very non-robust. There's still a lot of lack of resiliency in the mechanical supply base. That's an ongoing issue. It'll be an ongoing issue for some time. We are seeing an unlock that is happening. We are continuing to work with our suppliers very closely. We're continuing to invest in unlocking the supply base. We're doing a lot of work in terms of dual sourcing, multi-sourcing, many of our products to kind of unlock the capacity that exists there from getting away from single source scenarios that we've had with certain suppliers. It's getting better. There's much more recovery on the electronic side. Still a lot of work to do on the mechanical side, but I'm happy with the progression that we've been making quarter over quarter thus far. Where are your most stress? What end markets does that cut across? Is that, you know, when it comes to defense? I'm, I assume it's on the OE side, but what part of the business is it most acute? I mean, it's across the board. When I look at the supply base, to me, it's one supply base. It's one industrial supply base that supports multiple end markets. You know, same suppliers could be producing parts for us that support, you know, OEM production on the commercial side. Same supplier could be producing parts for us that support the defense end markets. The same supplier is producing parts for us to do all of our R&O work. That strain that exists within the industrial supply base, it's not as if you have a commercial industrial supply base and you have a defense industrial supply base. It's one industrial supply base supporting the entire industry. When you look at it from that perspective, theoretically, every single end market can be affected by that ultimately at the end of the day. I will tell you again, the electronics portion of our business, again, not labor-intense part of the portfolio in terms of a supply chain versus the mechanical. Electronics has recovered quite nicely. Mechanical, very labor-intense type work, specialized work that has to be done. That area is still struggling but recovering. I guess we brought up supply chain. Maybe I was gonna address this a bit in the margin discussion, but what, how do tariffs and what's going on out there impact Honeywell Aerospace? Yeah. The current scenario right now that's in place is that we, you know, tariffs is being relatively minor to the overall impact to our business. That's the current state that we're in today. I mean, that obviously can change, you know, depending upon what happens, in terms of any executive orders and/or decisions that are made. What I would tell you is that we do have a playbook. We will exercise that playbook. We will work very closely with our suppliers, very closely with our customers. If those scenarios change out over time, we'll make the necessary adjustments that we need to make within the portfolio, within the business, the multiple levers that we have to, again, minimize any impact that that could have. In present state today, under the current conditions of where tariffs are residing, it's minimal to negligible impact to the business. All right. Turning back to the top line on commercial OE, talk about the main programs where, you know, you guys kind of gained the most content and then how those are progressing from a production perspective and which ones do you see the most growth in this year as you kind of deliver on that, on that double digit? If I think about, I'll bifurcate that a little bit to commercial, for air transport and then commercial for business aviation. On the air transport side, obviously, as you're starting to see the ramps that are occurring with Boeing coming out of where they were at the end of last year, there's significant growth opportunity in terms of OEM production growth at Boeing. Similar, we're seeing it at Airbus as well. With the content that we have on board those platforms, which I'm very comfortable with the content that we have on those platforms, you'll see that double-digit OEM growth for us on a go-forward basis for 2025. Similarly, in business aviation, if you think about the areas of growth that are happening most in business aviation, think in terms of super mid-size aircraft, think in terms of large cabin aircraft. That is where we are exceptionally positioned with our products and our portfolios. The super mid-size, we have our HTF engine on board. We have APUs on board those aircraft. You get into the larger platforms. We are proliferated with our avionics and cockpits across those platforms. Those platforms are growing heavily in business aviation, which positions us very well coupled with the air transport work to see that double-digit growth on commercial OEM. For the ATR side, do you have any particular difference in exposure to the 320 or the 737? Yeah. I I mean, the content mix is a little different between the two platforms across the board, but we're very well positioned on both. That obviously then plays for where we currently have our aftermarket potential growth and then future aftermarket potential growth. We're very positioned well on both platforms and then wide body as well. Yeah. As far as, you know, obviously you have tremendous relationships with all these companies, but it is a very global industry. How do you see your customers? Are they talking to you at all about, you know, the tariff situation that they may have? Because that's coming across border as well. Some of this, I mean, Yeah. You just got to deal with the Canadian company. How are the customers reacting to this today? I would say in general, there's nervousness across the board as to what will be the next thing that will fall in terms of a decision that may be made. There have been reach-outs in terms of whether potential impacts to their portfolios, impacts to their aircraft platforms going forward. We just stay very much lockstep and in touch with what they're doing and what we're doing in terms of addressing tariffs and the like. If there's anything that we can do to support in some way, shape, or form, we will, we'll attempt to be able to do that. There is general concern across the board. Do you think this combination of, from a BizJet perspective, you know, definitely cross-border business, perhaps higher prices, even though I'm not really in, in that market, unfortunately, higher prices for some and, and, stock market volatility? I mean, is there a risk that there's a bit of a pullback in, in, you know, the BizJet market? Is that something we should be thinking about as a bit of a risk? Yeah. I would say it's something to be, you know, cognizant of and to watch very closely. Any conversations that I've had with our customers that have expressed some concern have not expressed that specific concern about a pullback happening. I mean, in business aviation in general, it typically follows more of a macro trend, not an interim, you know, insertion of a potential upset into the process. You know, those macro trends will be around GDP growth and the like going forward, wealth, you know, within the industry of those people who fly those particular aircraft. What I will tell you is that the backlog at these OEMs in the business aviation market segment is years of backlog that they have in place, right? You'd actually would have to have somebody come forth and say, "I'm not willing to accept an aircraft due to the current tariff situation that is in play." I don't anticipate that being proliferated across the board. I think on a near-term basis, the impact would be minimal at best. Got it. And I, from a Bombardier perspective, maybe just talk for a second about the deal that, you know, you guys announced in December and any other incremental color around that and your future R&D efforts with them. Yeah. No, I mean, it's a, it was a super exciting opportunity we had with Bombardier. It was a landmark deal that we were able to secure with them to kind of put that in context. That's working in partnership with Bombardier across multiple technologies within our portfolio, whether we're talking our HTF engines for aircraft, whether we're talking about our Anthem avionics, cockpits, as well as we talk about SATCOM communications. We established this broad, strategic partnership with them to introduce those technologies onto their platforms, both current and future platforms going forward. Total lifetime value that we looked at that, and I would say it's on a conservative basis, was about $17 billion across those three entities. I could not be any more excited about working very closely with Bombardier and introducing our products onto their platforms. What's the status of Anthem? Oh, so Anthem's progressing quite well in its development cycle. Very pleased with where we currently are today. I'll tell you, the development efforts, and the work that we've been doing, has been absolutely unprecedented in terms of the technology that we're developing with that particular system and introducing it into the cockpit. We've won positions unannounced on multiple platforms, on a go-forward. We've also gained a tremendous amount of interest in terms of aftermarket retrofits and mod upgrades of existing aircraft that may exist, that would have a desire for Anthem. The thing about Anthem going forward is the way that system is architected is very different than how we've architected other avionics cockpits within Honeywell Aerospace. There's a scalability of the architecture. We can take that cockpit, install it on a business aviation aircraft. We can scale it down, move it into general aviation. We can scale it up, move it into air transport, scale it up even further, move it into the defense market. It really has the ability to touch every single platform across the aerospace ecosystem in the way it was architected and the way it's being designed for introduction. Got it. Moving to, it sounds like the OE side, at least as we move into the year, and any comp issues where, you know, you're gonna kind of start the year a bit slower and ramp throughout the year, pretty consistent double-digit growth throughout the year. Yeah. I mean, there's always. Anything to consider here in the near term? There's always cyclicality that happens within our industry. It's never really a straight-line growth opportunity. I wish it was more along those lines. You start to see in terms of overall outputs, you know, you start to see a more normalization here in, in Q1. You start to see a growth throughout the balance of the year. It is a little bit of a sinusoidal effect that occurs. That's similarly in the air transport, you know, aftermarket as well in terms of flight hours. You know, we kind of have a little bit of that cyclicality that comes into play that's very typical within our industry. Can we talk about aftermarket? Lots going on here. Delta pre-announced last night some pretty weak numbers. What are you seeing, you know, day to day here in the aftermarket? You mentioned there's some volatility. Maybe just explain that as we move through the year. This would be mostly, let's start with the, you know, the ATR aftermarket for you guys. Yeah. I mean, I would characterize the ATR aftermarket as being a little bit more of a normalization. I mean, coming out of COVID, we saw some rapid growth occurring in terms of flight hours, a lot of the pent-up demand that passengers had in terms of wanting to fly. Now you're starting to see that a little bit more normalized. I mean, that wasn't sustainable on a year-over-year basis. Right. You know, constantly seeing double-digit growth year over year. I would say domestically in the U.S., we have fully recovered and we've actually surpassed the number of flight hours occurring on an annual basis pre-COVID versus where we are today. You're starting to see a little bit of that normalization occurring. Where you're not seeing that as much and you're seeing much more opportunity still for growth, it's a little bit more in Europe and particularly in the Asia-Pacific region as well. A lot more growth opportunity. That's where we're seeing a lot of growth with the platforms that we see flying out there, whether our content is more on that double-digit side in the, in the Asia-Pacific region. A little bit more normalization in the U.S., still opportunities in Europe, much more opportunity for growth in Asia. As we break that down a little bit, what is your headset? What are you thinking as far as flight hours growth this year? Yeah. For us on an aftermarket side, I mean, you can figure somewhere between the mid to, you know, overall, globally speaking, mid to high singles. Right. for the aftermarket. You'll start to see that a little bit more in the probably mid, in the U.S., you know, mid to high singles in Europe, and you may even surpass a little bit double-digit like we saw last year in Asia. That'd be a little of the distribution globally. Honeywell's view on flight hours, what is your take on what is your, you know, what is underlying that from a flight hours growth? Yeah. For us, from an air transport on a global perspective, it's sitting around, around five, five and a half. Five, five and a half percent flight hour growth. The content is kind of a little bit of a positive impact to get you to the mid, mid to high. Yes. I know Honeywell at a, at a higher level, has gotten about 3% price. How much of an influence is pricing in the aftermarket these days? How did that trend over the last couple of years? It's trended basically in that particular ballpark that you've described, and that's been the trend for the last few years as well. Okay. 3%. Mm-hmm. Okay. The BizJet side, perhaps a little different. What are you seeing in flight hours there, and how do you think about BizJet aftermarket? Or maybe not too different. It is a little different though, actually, right? I mean, coming out of COVID, there was a massive whipsaw that happened in terms of flight hours in business aviation. It's tremendous exponential growth, as the air transport market was waning in terms of growth going forward out of COVID. That is now, you know, sort of self-corrected and has become much more normalized. I would say from a business aviation flight hour perspective, you're probably somewhere in the low singles, flat in certain market segments, but low singles overall. You guys have talked a lot about upgrades and mods and things like that. Right. Is that more of a, I would assume that's more of a business jet, dynamic than a, than an ATR, driver? No, it's actually both. Both. It's actually both. To kind of expand upon that a little bit, that's what you refer to our retrofit mods and upgrades. Yeah. We actually call it RMUs. Yeah. You know, and that's. Definitely. It's a really nice part of our business and a nice part of the portfolio that has seen tremendous growth over the years through the investments that we've made. The thing that I would characterize is that's really built upon the large installed base that we have across the industry. There's virtually not a single aircraft flying in the free world today that in some way, shape, or form does not have Honeywell content on board. These aircraft fly for 20, 30, 40 years. As new technologies are developed, as new features, new functions, new enhancements in terms of safety, those generate opportunities to upgrade or retrofit or mod some of the equipment that we have on board those aircraft today. We started that process probably about 15 years ago in terms of investing into these RMUs. Right now it's a part of our portfolio that's well north of $1 billion on an annual basis and growing at double digits going forward. It still is that opportunity for us. When I think about where we are today in terms of OEM production rates and double-digit production rates, to me, I view that as just seed planting for the future. It's just more aircraft entering into the market, which produces more opportunities for us to continue investing and continue driving those RMUs. Lastly, on defense, what is the outlook for the next couple of years, what's going on globally, how is that influencing Honeywell? Yeah. Our portfolio is roughly 60% commercial, 40% defense. It is a representative large part of our portfolio. What I would tell you is that what we're seeing in terms of the geopolitical concerns that are existing around the world, which do not seem to be waning across the board, is driving a substantial amount of investment and budgetary increases with a lot of our NATO allies and peers across the board, which will drive a lot of opportunity in the international market segments. We're reviewing defense for us being about a mid-single digits coming off of a double-digit growth from last year. We continue to see the investments occurring, particularly in Asia, particularly in Europe. We see opportunities with our products through Foreign Military Sales that we do as well that will generate some growth for us in international market segments. Our business, you know, international versus domestic on defense, you can think of it in terms of about 70-75% domestic, maybe 25% international, and that international opportunity space that is being able to grow for us through the investments that we're making. Turning to the, to the margin side, the 29% margin was put out, a couple of years ago. Yep. You know, it's not quite a straight line on the way there. There's been some acquisitions. What are, talk about the bridge on margins this year and what do you see as kind of the underlying cadence going forward from a margin perspective when you, you know, kind of strip out the acquisitions? It's definitely not a straight line. Yeah. That's for sure. I would bifurcate the margin story for Honeywell Aerospace into, I would call it a near-term and a longer-term view. Near-term, what I would say is, if you exclude the effects of the Bombardier transaction that we did in Q4, we should be somewhere slightly up, flattish, you know, thereabouts, in terms of margin performance. It's really three major contributors that are holding us in that realm that we're talking about. You know, one of them is OE production rates. As I mentioned a moment ago, we're seeing double-digit growth on the OE side as opposed to what we see on the aftermarket. That creates mixed headwinds that we have. That's a little bit of a headwind that will depress margins. The second element that I would describe near-term is the continued investments that we're having to make in the supply base to unlock investments we're making with suppliers, investments that we're making and buying tooling for them and the like going forward. That is a little bit of a headwind for us as well. The third element that you just mentioned a moment ago, Steve, is acquisitions, right? You know, closing out on the two acquisitions that we did. The integration cost associated with those acquisitions is also a headwind. That is sort of the near-term dynamic when we talk about margin performance for Honeywell Aerospace. Are investments in mix roughly the same size or does one, is one significantly more than the other from a year-over-year perspective? Yeah. If we think about that bridge. In terms of investments? You just talked about investing in the supply chain and. Oh, yeah. Unlocking. Is that, are those similar, similarly sized items, or is one significantly larger than the other from a year-over-year perspective? They're similar. Okay. They're similar in terms of size relative to that. If I pivot to a little bit of a longer-term view in terms of margins, I definitely see a path to attainment to the 29%. It's just gonna be in a little bit more of a protracted timeline. As those three issues that I mentioned a moment ago start to alleviate themselves, obviously OEM production will begin to normalize. You'll start to see the mix between OE and aftermarket starting to shift. Hence, what was a headwind then becomes a tailwind. We'll complete the integration, and those costs will fall off the books as another example. Thirdly, you know, at some point in time, those investments will start to wane coming out of the supply base as they've recovered to a more normalized demand going forward. and then hence you can see that trajectory then, you know, on the attainment to 29% going forward. Is 29% going to still be a part of, you know, your long-term targets when you guys come out? Is that, is that, sounds like it's still, you know, in your mind, you know, the right level for this? You mean like when you say come out in a post-separated state? Yes. Correct. Yes. Absolutely. Absolutely. That's still part of our long-range plan. Yeah. Okay. And obviously that depends on mix and things. But is there any, for as of now, when you think about, you know, Honeywell has a reporting structure, segment margins, and then like a bunch of stuff below the line. Mm-hmm. How does aerospace, is it, should we, you know, it's pretty easy to pull out the segment numbers, restructuring things. Anything below the line that will move around from a reporting perspective that aerospace will take more than their fair share of? I think that's something that we'll be working through. In the P&L? Yeah. We'll be working through that as part of the separation exercises going forward. That's, I think, probably a TBD. Okay. Ultimately how that will be structured. What I will tell you is that, you know, the commitment across the organizations that we have made and the commitment we've made to, to shareholders and, and investors is that when the company separates, you'll have, you know, the automation, you'll have aerospace, and now earlier on, you'll have advanced materials going forward. All three of those will have a balance sheet that is definitely investment grade. Okay. I guess from a portfolio perspective, anything that you're looking to do differently when it comes to investing in the business, both inorganically as well as organically? Yeah. What, what's on your mind as far as this window you have to prepare yourself for being a, a public company? Yeah. I think the one thing I would say is, from an organic standpoint, I'll organic and I'll pivot to inorganic here for a moment. On the organic side, definitely taking advantage of the fact that we're in this upcycle and we've been in this upcycle for quite some time. The amount of investments that we're making back into the business and back into the portfolio are world-class in terms of overall investments that we're making. There isn't a single portion of the aerospace portfolio that we are not currently investing in new technologies, new innovation, and new services that can be provided. Whether we're talking avionics, whether we're talking our navigation sensor systems for being able to operate in GNSS-denied environments, HTF engines for next-gen, next-gen APUs, electrification, autonomy and autonomous operations, vapor cycle cooling systems. I mean, you look at the breadth of the portfolio and the amount of wins that we have had, it requires you to invest in order to convert those wins into opportunities in the future. We are investing in every single facet of our business going forward. That's on the organic piece of it. We will continue to do that and we'll continue to grow that on a year-over-year basis. Is there, is there incremental investment that you wanna make? Like this year at supply chain, and as that supply chain headwind wanes, that maybe you'll feather in a bit more investment as you prepare yourself to be a public company? Or is that, or is that investment kind of at a steady year-over-year run rate, you know, so it's, there's no real. I mean, as we. Fungibility there. Yeah. As we look at capital allocation within the aerospace portfolio, as we start to bolster up and we start to develop that resilient supply base, it will free up funds to be able to invest even more for the future. Where we sit today and where we've sit for the last couple of years, I'm very comfortable with the amount of investment that we've been making on a year-over-year basis, where we are investing this year, and what we see investing over the next few years on a go-forward basis, which will continue to grow on a year-over-year basis. Okay. R&D kind of flat. You're comfortable with your level of R&D. R&D flat, it's a percentage of sales in your mindset? Yeah. Yeah. I mean, right now we're running at about 4%. Yeah. Slightly up from last year. I could see that increasing to a low 4% going forward. Yeah. Okay. That's on the investments internally. We don't talk a lot about customer funding. Yep. That happens. Gets you to like seven or something like that? It gets us to about 7% when we do that, when we make that calculation in place. Okay. Sorry I interrupted you, but on the inorganic side. Yep. Yeah. We will continue to be very, very active in the inorganic front as well. In all of my years in Honeywell Aerospace, I've never seen our acquisition pipeline to be as robust as it is across the entire portfolio, across all of Honeywell, inclusive of aerospace as well. We will continue to look at properties. I think there are certain properties out there where we are the best owners of those properties with the synergies that we can provide to enhance growth, to enhance margins, and also to grow technologies in certain spaces at the end of the day to provide technology and innovation to customers where that makes sense. We will continue to be very active on that front. Lastly for me, before we turn it over to these guys for questions, free cash flow. Mm-hmm. You know, Honeywell currently converting on adjusted earnings at about 85%. I think on the call, you guys had talked a bit about 100%. I'm not quite sure like what that definition is, but is there a pathway for you guys to get to 100% conversion at Aero or, you know, what, what's the, what's kind of the path to get to 100% or not at Aero? In Aero we're around 83% free cash flow conversion at the moment. The biggest unlock for us is unwinding our inventory positions that we have currently today. That has been the biggest impediment for us going forward. We will begin unlocking that as the recovery in the supply base occurs and things begin to normalize. We'll get that inventory back down to a normalized level. There is nothing foundationally or fundamental within the Honeywell Aerospace portfolio that doesn't mean we can't achieve 100% free cash flow conversion at the end of the day. I just gotta, we just have to unwind all of this inventory buildup that we've been doing over the last couple of years to support the demand and to support our customers. Anything on, you know, for large global integrated organizations as they, you know, kind of come apart a bit, and anything on taxes and cash taxes that, you know, you see as being a moving part in this discussion at all, whether it's on a book or a cash basis? Yeah. I'm sure that's part of the discussions that are ongoing right now. You know, at the Honeywell, you know, corporate level in terms of some of the decisions that I haven't seen anything personally. So I wouldn't be able to comment on how they're handling that. Okay. Any questions out there? I know it's early. Seth. Hey, good morning. Morning. Wonder if you could talk about when you think about that mix dynamic going forward as the OE rates come up, and we start to see more retirements, what impact that will have on mix and on profitability going forward? Yeah. I, so you will definitely start to see some retirements, you know, but the net-net of everything going forward will be accretive, you know, in that space. What I will tell you about retirements of aircraft, it actually produces opportunities for Honeywell. We have a business within Honeywell, what we call our Honeywell Aerospace Trading business, where we look at acquiring assets off of the market, bringing them into our facilities, bringing them into our factories, do a repair and overhaul, and be able to put an OEM ticket on those and get them back out into the aftermarket to be able to support customers going forward. We actually view that as an opportunity for us to be able to continue to drive the growth that we see on a, on a go-forward basis. How big is that business? It's, it's, you know, not to quote a number specifically within that portion of the portfolio, it's, it's significant enough that we can see a lot of growth happening there. Okay. Seth didn't even move. I was expecting him to like, you know, wink or something or something like that. I think that's a good question from the Aero expert in the room, of course. Like, I, how is, how is that accretive? I guess you're saying, I guess, but from a mix perspective, retiring a plane, replacing it with a new one, like for like, that is a pretty nice revenue, but pretty dilutive event for you guys, right? I mean, like you guys make really good money on some of the older stuff. Mm-hmm. That is the right kind of mindset that. Yeah. You should definitely think about it in terms of that mindset as well. Okay. Right? What happens is that what we're putting into the market today is what I call that seed planting for the future that will generate those aftermarket revenue opportunities for us going forward. Are you seeing any of that in this year's numbers or it's too early, it's too early for that given we're not really seeing the. Yeah. I would say if you look at the fleet mix today, what I call classics, right? The, you know, the classic 737s and the CEOs that are out there, the ratio of those aircraft to MAXs and NEOs that are in the market is about a three-to-one ratio today. That creates a lot of that opportunity. I think it's too early to say near-term what that will represent. What I can tell you is the demand is substantial and they're keeping those aircraft flying longer and longer than they had ever anticipated. Even with the outputs that are increasing on the OE side, they want to keep those aircraft flying to support the demand that is out there. I guess from that perspective though, if you do start retiring more and the inventory of these parts grows, but you're serving less planes, why isn't that like a negative for the trading business as well? When we think about supporting the aftermarket, you know, you can support it through a repair and an overhaul of an asset. You can support it through spare sales of an asset, or you can support it through a used serviceable material asset into the market. Yep. Now, when some of those assets become available into the used market, there are other potential individuals who would wanna buy those assets as well to kind of resell them. There is a lot of value when you take that asset and bring it back through the OEM to do a refurbishment back to OEM standards, back to OEM requirements. Got it. There is value in that used asset that we would acquire, bring it through our shops. We can either use those parts to support R&O activity, or you can use those parts, repair them, put an OEM ticket on it with the value of having an OEM certified piece of equipment and then resell that into the market. Right. Some of those assets come in to be able to support R&O. Some of those assets come in to be able to support a rebuild and a refurb and then resend it back out. You have your spares assets that you sell into the industry. Right. It's a little bit of a balance across. You guys are such a global organization with like a tremendous, you know, distribution channels and customer relationships. Correct. You guys are positioned well to do that. Correct. Any questions? One last one out there? Okay. I think you're good. Thank you. Awesome. Steve, thanks a lot. Thank you so much for your time. I really appreciate it. I really appreciate it.